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Complete Online Gaming Legal Update Here

Many Things Have Happened Since the Beginning of the Year


The tide is turning since that fateful day in October of last year when President Bush signed the Unlawful Internet Gaming Enforcement Act (UIGEA) into legislation after then-Senate Majority Leader Bill Frist snuck the bill through Congress.

Frist's scandalous efforts circumvented the American process of public dialogue and debate. The time-honored tradition of community debate was violated and citizens for and against the Act were equally offended. What has happened since the passage of the UIGEA?

The United Kingdom

Following on the heels of the UIGEA's passage, the first international summit for online gaming occurred in the U.K. to discuss how to regulate the industry. The U.S. chose not to participate.

Culture secretary Tessa Jowell criticized U.S. anti-gambling legislation, telling delegates from 32 countries that the U.K. did not support the United States' stance on Internet gambling and was worried that its legislation would create unregulated offshore sites.

The U.K. position regarding online gambling is imminently reasonable and serves three basic principles: Crime-free gaming, protection of the vulnerable, and insuring that citizens can engage in fair betting.

A Democratic Congress

A convergence of events led to the Democrats taking over Congress and winning governors' seats across the country. Sixty percent of voters leaving the polls said they opposed the war in Iraq; 40 percent said their vote was a vote against Bush. Also, a significant number of voters said corruption was crucial in their voting decisions, by which, of course, they meant Republican corruption.

The climate on Capitol Hill clearly changed for the better. Thirty-year incumbent Jim Leach (R-Iowa), an avid proponent of banning online gaming, was defeated.

It is anyone's guess how much poker issues played a part. I have to conclude that Frist's sneaking in the UIGEA so Leach would support him as a presidential hopeful in Iowa certainly played a part in Leach's defeat. It also played a part in Tennessee's no-confidence vote for its hometown senator (Frist) for a presidential bid.

The World Trade Organization Ruling

After a hard-fought battle with Antigua, a nation of 80,000, the U.S., with our population of 300 million, lost the WTO case in which Antigua alleged that we engaged in protectionism by allowing remote betting within the U.S. but not with offshore companies.

It is interesting to note that Japan, China, and the European Union (EU), were third parties who joined in to support Antigua's position in the Internet gaming case against the United States.

The WTO has ruled that the United States remains out of compliance with its GATS (General Agreement on Trade in Services,a treaty of the WTO that entered into force in January, 1995) commitments to permit Antiguan remote gaming operators access to the United States market.

Deputy United States Trade Representative John K. Veroneau has now informed the WTO that the US.. never meant to be a part of the gaming section of the WTO. Of course, Veroneau is surely still getting his advice from Frist, for whom he used to work.

Questioning the Ethics of the AG's Office

There is a recent congressional investigation into the matter of whether the Department of Justice and the White House were using U.S. Attorney positions for political gain.

Attorney General Gonzales was appointed by Bush and previously served as his counsel. After eight U.S. Attorneys were suspiciously fired in 2006, the new Democratic Congress initiated an inquiry. Some of those attorneys were apparently targeted for dismissal to impede investigations of Republican politicians and some were targeted for their failure to initiate investigations that would damage Democratic politicians or hamper Democratic-leaning voters. The congressional hearings have uncovered a myriad of ugly events that occurred with Gonzales at the helm.

You may remember that Gonzales is charged with coming up with the rules and regulations required by the UIGEA. He recently balked at the suggestion that such rules could be effective, stating instead that his office prosecutes lawbreakers.

Pro Poker Bills

It is important to note that ever since the first online casino opened its virtual doors in 1995, legislation has been proposed to ban it. Until Frist snuck the UIGEA through, no other bill had a chance of passing, because lawmakers really didn't want to get involved in this type of legislation.

However, since the passage of the UIGEA, legislators now have a persuasive position to proclaim; it is the position of protecting personal freedoms. Our country is based upon that proposition.

In a way, Frist helped the cause of making online poker legal and regulated by offending the American people by his shenanigans and also by the substance of the UIGEA. Now, many legislators are joining in the battle to protect personal freedoms. Let's look at the specific bills that have been introduced within the last few months.

Rep. Barney Frank (D-Ma.): The Internet Gambling Regulation and Enforcement Act

After Rep. Barney Frank said the UIGEA was the stupidest law ever passed, he introduced the Internet Gambling Regulation & Enforcement Act (IGREA), H.R. 2046, which essentially creates a system for federal regulation subject to certain rules and regulations, including upholding state laws, protecting minors and compulsive gamblers, preventing money laundering, fraud and identity theft along with other protections. When Frank introduced the IGREA, he scheduled a June 7 hearing before the U.S. House Financial Services Committee, which apparently went well for the representative.

Rep. Shelley Berkley (D-Nv.): The Internet Gambling Study Act

Just like last year, Rep. Shelley Berkeley again introduced the Internet Gambling Study Act, H.R.2140, which proposes a one-year study on Internet gambling to be conducted by the National Academy of Sciences. The previous bill proposed an 18-month study. The current bill would study the effectiveness of regulating online gaming, along with analyzing the impact of the UIGEA and examining the recent ruling against the U.S. by the WTO.

Rep. Jim McDermott (D-Wa.): The Internet Gambling Regulation and Tax Enforcement Act

Rep. Jim McDermott introduced the Internet Gambling Regulation and Tax Enforcement Act, H.R. 2607, a companion bill to Frank's IGREA that would tax licensed online gambling companies. Gambling operators licensed by the Financial Crimes Enforcement Network would be required to pay a fee of 2 percent of all funds deposited by any person placing a bet.

Rep. Robert Wexler (D-Fla.): The Skill Game Protection Act

With the assistance of the Poker Players Alliance (PPA), Rep. Robert Wexler authored and introduced H.R.2610, which would exempt poker from online gaming prohibitions. The Skill Game Protection Act proposes that skill games, including poker, mah-jongg, bridge, backgammon, and chess would be exempt from the UIGEA.

Wexler conveyed the concept with great simplicity: "Poker is a game, not a crime… We should protect the freedom of law-abiding adults to participate in these great American games."

The Changing Tide

There is no doubt that the tide is changing. The AG's office and the actions of the White House are being reviewed by Congress for possible misconduct. Such an inquiry could have happened only with a Democratic Congress.

It is a form of cheating to stack the AG's Office with Republican puppets. It was a similar form of cheating when Frist snuck the UIGEA into the Port Authority Act so that Leach would help him win the presidential election in Ohio. They both got what they deserved. Leach lost his seat and Frist's own constituents refused to support him for president.

There may not have been a great swell of support regarding online gaming in the past. But now, thanks to some improprieties on behalf of governmental officials, online gaming is the talk of the town. The momentum is building so that now our congressmen are heard to say: "Poker is a game, not a crime."

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